How to start a small warehouse business?

Starting a small warehouse business

The first step in starting a small warehouse business is, you need to know the industry and customers you will service. 

Global supply chains and local industries are evolving in response to delays, demand, and the opportunities presented by new technology. These changes are greeting a range of opportunities for new warehousing entrants, and for existing businesses to upgrade or add to their offered services. For example; check out our recent webinar on 3PL Nearshoring success here! 

Step 1: Select Your Warehouse Service

The warehouse market is ripe with opportunities for new businesses, thanks to several evolving trends and increasing demands across various sectors.

For one, the post-COVID rise in e-commerce and last-mile delivery expectations have caused a major shift in demand in the industry, creating opportunities for new small businesses to enter and capitalize on the growing market— and the evolution of new specilized services has seen the emergence of new revenue opportunities, and the opportunity to offer more diverse fulfilment within the industry. 

E-commerce warehousing 

The boom in e-commerce after COVID has really shaken things up, especially when it comes to last-mile delivery. Suddenly, there's a huge demand for faster and more efficient delivery services, opening the door for new small businesses to jump in and offer differentiated services to customers, with secure online integrations, white glove or FMCG picking, and omnichannel delivery partnerships. 

Serialized goods

The world of serialized goods—items that require individual tracking, like electronics, pharmaceuticals, or luxury items—has seen significant growth, driven by the need for precise inventory management and traceability. This sector presents a golden opportunity for small warehouse businesses to carve out a niche. However, handling serialized goods isn’t just about managing inventory; it’s about ensuring each item is tracked with absolute accuracy throughout the entire supply chain. To succeed in this specialized market, you’ll need to understand the unique demands of serialization and have the right systems in place to manage the complexity efficiently.

Food and beverage 

The food and beverage industry offers a dynamic and vital opportunity for small warehouse businesses, especially as consumer demand for fresh, high-quality products continues to grow. But operating in this sector comes with its own set of challenges. From maintaining strict temperature controls to complying with food safety regulations, managing a food and beverage warehouse requires precision and attention to detail. Success in this field isn’t just about storage; it’s about ensuring that products are handled safely and efficiently from arrival to dispatch. To thrive in food and beverage warehousing, you'll need to navigate these unique requirements and implement systems that support both compliance and efficiency.

Bulk Goods

Bulk warehousing is a cornerstone of many supply chains, especially for businesses dealing with large quantities of goods. This sector focuses on efficient handling processes like cross-docking, destuffing containers, and managing pallet-in, pallet-out workflows. For small warehouse businesses, mastering these operations is key to success. It’s all about speed and efficiency—moving goods quickly through the warehouse to minimize storage time and costs. With the right processes and systems in place, you can optimize these workflows, ensuring smooth operations and timely deliveries for your customers.

Step 2: Get The Right Tools For The Job

The key to long-term growth lies in understanding the needs of your customers and ensuring your operations are built to serve them efficiently. From the very beginning, selecting the right Warehouse Management System (WMS) is crucial. This foundational decision will not only streamline your daily operations but also position your business to scale seamlessly as demand increases. 

A few things to consider in planning your small warehouse business include:

• Your starting budget and cash flow
• The location of your small warehouse
• Size and orientation of the operation
• Resources on hand to serve customers
• Staffing (consider staff expertise and license requirements as well as hiring attraction and retention) 

Upon deciding upon the type of small warehouse business that you want to start, it’s time to consider the type of inventory. This will be based on size of the warehouse and the capital you have set aside for equipment such as forklifts, pallet racking, ventilation and security, as well as the demand for services in your area.

An important consideration is that some goods cannot be stored together. This is certainly the case with dangerous goods and chemicals. There also might be restrictions on the type of trucks which can access your area.

With a cloud-based warehouse management system like CartonCloud, you can set storage rules for warehouse locations and specific inventory, which will help you ensure correct storage during put away and stock movement. When selecting customers, you will also want to know what type of inventory your prospective customer typically needs stored and dispatched, plus the pain-points with their current warehouse.

The next step is getting your set up right, and one big decision is selecting a comprehensive software system that is right for your business operations, size, and setup. It's important to know what services you want to offer and what services your customers are looking for when selecting your logistics software. 

Step 3: Finding The Right Software 

Software integrations

Setting up your tech stack should be one of your first actions. You'll need to consider the software platforms your customers are using (are they selling on e-commerce sites like Shopify, using specialized management software like beverage ERPs, online accounting systems, route optimization software, shipping aggregators, or other systems you will want to link in with? Having the ability to access or create seamless software integrations means you can easily transfer data between yourself and your customers, reducing admin and increasing your accuracy and transparency. 

Barcode Scan and Print

Barcode label scan and print is a game changer (check out all you need to know about barcode labels here). Barcode labeling will help you establish your warehouse locations and identify product storage, select stock with accuracy, track stock movement within your warehouse, assign to sales orders or consignments, and record incoming freight. 

WMS/TMS integrations 

If you're looking to provide cross docking services for customers, you'll need a system that can manage this operation. Cross docking, or transloading, is where you accept incoming stock for short-term storage, and then sort and allocate freight to new distribution legs from the dock for faster, optimized delivery with minimal handling. CartonCloud's integrated WMS/TMS software provides accurate and simple functionality for cross docking, allowing you to view incoming freight and allocate to the preferred outgoing consignment with ease. 

Do away with paper from the start

Paper-based processes can be time-consuming and inaccurate. Opting for a cloud-based software solution can literally mean cutting your admin overheads by 80%. With automated data entry, you can optimize workflows, automate rate card calculations and invoicing, and streamline your sales orders or incoming electronic Proof of Delivery notices for faster processing.

Set yourself up for scalability

Just about every business owner seeks to expand their operation in the warehousing industry. One key aspect is through automation. Automation doesn't mean having a warehouse full of pick robots or driverless vehicles. On the contrary, automation allows your team to work smarter, by optimizing manual workflows to reduce back and forth, and streamline operations. 

For example, features like wave picking allow your warehouse staff to pick a bulk selection of one item that appears on multiple orders at once, saving them from walking back and forth to that location for each order. 

Keep Growing: Learn from the Industry 

Lastly, there's a wealth of experience out there, in your future partners and colleagues. Our industry is changing rapidly, and the success of global supply chains is built on the effective communication and partnership of a number of businesses, sole traders, and companies — like yours. Make contacts, learn, and offer support where you can.

You can find a range of stories from our customers on the CartonCloud YouTube playlist here, sharing their experiences and expertise.  

Want to know more?‍

CartonCloud has thousands of users now using our streamlined solution for those in the warehousing or logistics industry, and we've helped over 380 companies to optimize their operations worldwide. 

No matter how large or small, or even if you’re in the early stages of starting up, we can assist in reducing the challenges that traditional warehouses still face. Give us a call today to see if we can be of assistance in this new journey.

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Get your FREE demo below, and see our powerful software in action. 

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Page last updated Sept 9, 2024.